The complicated relationship between Sprint and Clearwire will continue; as the two companies settled a dispute over wholesale pricing.
Sprint made an amendment to a long-term agreement it had with Clearwire over wholepricing terms. The new deal provides Clearwire, which has had significant debt, a minimum of $1 billion from Sprint over the next two years for all of its services. The deal calls for Sprint to pay Cleawire $300 million in 2011 and $550 million next year at minimum for the usage of its 4G network. Sprint will pre-pay $175 million for the 4G network use.
We are pleased to reach this wholesale pricing agreement with Clearwire, said Dan Hesse, Sprint CEO. We look forward to working with them under this new agreement to provide an expanded offering of 4G capabilities and solutions for Sprint customers.
The companies had a dispute over the value of Clearwire's 4G, WiMAX network. Over the past year, Sprint has been highly touting its 4G network by adding phones from HTC and Samsung.
To complicate matters, Clearwire makes no bones that Sprint is its biggest and most important customer. Sprint has a 54 percent majority stake in the company and has often been linked to acquisition rumors.
Today's agreement further aligns Sprint and Clearwire's interests and lays the foundation for a continued, constructive relationship. We are pleased to have the resources and partnerships necessary to maintain our 4G leadership and leverage our significant spectrum and capacity for delivering mobile broadband services, John Stanton, Clearwire's interim chief executive, said in a statement.